Online video ads grew by 24 percent year-over-year (YOY), finds online video monetization company FreeWheel. Its Video Monetization Report for Q4 2016 includes lots of year-end stats that show how far the industry has come.
For example, both ad views and content views have increased over the previous 24 consecutive quarters. That’s six solid years of growth. Total video views grew by 26 percent in 2016. That growth comes with a warning: “As viewing continues to increase, structural changes are needed to keep up with that change. Technology, user experience, and monetization strategies all must evolve to support this continued growth,” FreeWheel cautions.
In the U.S. 46 percent of online video views were on entertainment content in Q4 2016, while 28 percent were on sports content. But growth figures show sports grew by an impressive 60 percent YOY, while entertainment grew by only 2 percent. The music category actually shrank: While 10 percent of online video views were on music content, that’s an 11 percent decline YOY. With many pro sports events available online, 2016 was a crucial time for the category.
One big question publishers and broadcasters will have to grapple with in 2017 is the optimal number of ads in a mid-roll break. Poor viewing experiences have led to greater use of ad blockers. Viewers have “ad fatigue,” FreeWheel says, and the industry is finally paying attention. In Q4 2015, the average mid-roll ad break for live video was 130 seconds, but in Q4 2016 it was only 104 seconds. Mid-roll breaks on on-demand video, however, got slightly longer, going from 92 seconds to 99 seconds.
Looking at authentication, FreeWheel finds the rate has plateaued. In Q4 2016, 71 percent of ad views on long-form and live video in the U.S. came from authenticated viewers, a number that’s been roughly the same for a year. If technology companies make authentication more seamless, the number could improve, FreeWheel suggests.
For more end-of-year data, download the full report for free (registration required).